Is retirement at age 65 priced out of most people’s range?
For decades, 65 has been the age when we are all expected to get the golden handshake. After all, it’s also the age when government pensions kick in.

But new research from Chartered Professional Accountants of Canada (CPA Canada), reported in Wealth Professional magazine, suggests many of us won’t be able to afford to hang it up at 65.

CPA Canada found a 42 per cent of working, unretired Canadians “think they will still be working past 65,” the magazine notes. Twenty per cent of respondents cited saving for retirement as “their most substantial financial concern,” with 17 per cent saying paying off debt is their top financial priority, the magazine notes.

On the plus side, 41 per cent of those surveyed think their finances will improve over the next year, reports the magazine. Forty-five per cent think things will stay the same, and 11 per cent worry their finances will get even worse, Wealth Professional notes.

Other findings noted in the article: 74 per cent of those surveyed said they save monthly, with 63 per cent having a savings account and 52 per cent having TFSA savings. Eleven per cent admitted they had no savings of any kind, the magazine noted.

CPA Canada’s Doretta Thompson, director, corporate citizenship, told Wealth Professional that while it is “welcome news” that so many Canadians feel their finances will improve, there needs to be “more financial literacy education, particularly around retirement saving and debt management.”

A final note from the article – most surveyed were concerned that rising interest rates would make it harder for them to save, as the cost of servicing their debts would go up.

It’s important to make savings automatic and regular, a “pay yourself first” scenario. An excellent way to achieve this goal is to set up automated savings with the Saskatchewan Pension Plan. You can contribute up to $6,000 a year to SPP, and you can do it at your own speed. And when you retire, SPP can help you turn those savings into a monthly income stream.

Perhaps the dream of retirement at 65 is harder than it used to be, but SPP does provide you with the tools you need to make it happen.

Written by Martin Biefer

Martin Biefer is Senior Pension Writer at Avery & Kerr Communications in Nepean, Ontario. After a 35-year career as a reporter, editor and pension communicator, Martin is enjoying life as a freelance writer. He’s a mediocre golfer, hopeful darts player and beginner line dancer who enjoys classic rock and sports, especially football. He and his wife Laura live with their Sheltie, Duncan, and their cat, Toobins. You can follow him on Twitter – his handle is @AveryKerr22

We sometimes think of retirement as an individual weight that we all must bear alone. But sometimes, using a collective approach can make that heavy load a little easier for us.

So says Alex Mazer, Founding Partner of Common Wealth. “Preparing for retirement is pretty hard to do individually,” he notes, adding that many people have trouble saving at all, he says, and few start while young. Then, they “can make poor investment decisions” when left to their own counsel, and thus don’t benefit from “the pooling of longevity and investment risk” that comes with a collective savings approach.

Without investment advice, which Mazer says can be difficult to get, many of us invest in high-fee, inefficient savings vehicles. Research shows that this individualized retirement reality results in low savings at retirement for all but the wealthiest among us, Mazer says.

Turning savings into retirement is also a complex process, he says. You have to keep investing while you are taking money out of your savings plan, he explains. If your money doesn’t continue to grow there is the danger “of overspending your savings, which can translate into reduced income later in retirement,” Mazer warns.

A collective approach is better than an individual one, Mazer says. With collective savings, investments can be pooled, reducing investment and longevity risk and reducing management fees. Finally, there can be simple, cost-effective ways to turn the savings into retirement income in a collective plan, he explains.

Working with different partners, Common Wealth is developing new collective retirement plans that are aligned with these principles, Mazer explains.

The company developed a plan for lower-income healthcare workers that combines a group TFSA with some of the key characteristics of a pension, including fiduciary governance, pooled investment management, and the potential for mandatory contributions through payroll. By using a TFSA structure, Mazer says, income at retirement is tax free, which means eligibility for the Guaranteed Income Supplement is not impacted.

The firm’s latest project is developing a nationally portable retirement plan for the non-profit sector, where about 850,000 workers who don’t have any sort of retirement vehicle at work. That number represents about half the non-profit workers in Canada. Again, the plans call for a pooled, collective system with professional investment management, low fees, and a plan for turning savings into income.

Mazer says that if he could personally influence one policy change, it would be to create “high quality collective plans with auto-enrolment” for workers lacking a pension plan at work. Auto-enrolment has worked well in the UK’s NEST program – very few people opt out. Mandatory plans are also popular in Australia. The result in both countries is a much higher level of retirement saving, he concludes.

We thank Alex Mazer for taking the time to talk to us. The Saskatchewan Pension Plan is an open defined contribution plan where contributions are invested collectively with professional management. Annuities are available to help you convert savings into an income stream. Perhaps SPP is the missing piece of your own retirement puzzle.

Written by Martin Biefer

Martin Biefer is Senior Pension Writer at Avery & Kerr Communications in Nepean, Ontario. After a 35-year career as a reporter, editor and pension communicator, Martin is enjoying life as a freelance writer. He’s a mediocre golfer, hopeful darts player and beginner line dancer who enjoys classic rock and sports, especially football. He and his wife Laura live with their Sheltie, Duncan, and their cat, Toobins. You can follow him on Twitter – his handle is @AveryKerr22

Before you start reading this blog, I’m warning you that it does not contain typical financial advice. After all, at this time of year personal finance writers and bloggers wax lyrical about all of the important things you should do with your income tax return, like reduce debt; contribute to your RRSP, TFSA or your kids RESP; or pay down your mortgage. I know. I’ve already written that article.

According to Tim Cestnick at the Globe and Mail, CRA pegs the average Canadian tax refund is about $1,400. I agree with him that if you receive a $1,400 tax refund each year for 25 years and invest that refund at 8% (which may appear on the high side but is realistic over a 25-year time horizon), you’d have $102,348 at the end of that time.

But what if once, just once, you blow it all on one or more items on your personal wish list? Maybe the memories you buy with that windfall will ultimately turn out to be an excellent investment or satisfy a greater need than a few extra dollars in the bank when you retire.

So continuing on this heretical tangent, here are some ideas to think about.

Take a vacation: Whether renting a cottage for a week with the family or jetting off to Disneyland, you will be buying the gift of time with your loved ones and a break from workplace stress.

Replace energy-inefficient appliance: Investing in a new washing machine can save you $415 dollars over the 11 year life of the appliance. Throw in a clothes dryer and energy savings will amount to another $160. And if you don’t have to go to the laundromat and pay a repairman every time one of these appliances conks out, you’ll save time and time is money.

Home repairs: You need a new roof. Or, you’ve been meaning to upgrade your kitchen and bathroom. Investing your tax return in your home will increase your enjoyment and it may enhance the value of the property.

Hire household help: Divorces are expensive. We have been married for 41 years and I intend to stay that way. I attribute my stable marriage in part to a regular cleaning lady. My husband and I both hate cleaning and I hate clutter. Bringing in a pro is one of the best investments we ever made.

Get a pet: We have gone from a sheltie to two Nova Scotia Duck Tolling Retrievers to a tiny cockapoo in the course of our marriage. They get us off the couch and walking which is good for our health. And there isn’t a day that goes by when they don’t make us laugh. Our succession of cats has been more sedentary but they were always good for a therapeutic cuddle.

Seek financial advice: A financial plan is a road map for life and retirement. You get what you pay for. Invest your tax return in a consultation with a well-reputed independent financial advisor who can help you develop a strategy and a timeline to reach your goals.

Support sports or the arts: Join the museum or the art gallery. Get seasons tickets for a theatre company. Take your kids to a rock concert or a football game. Learning is not only done in school and bonding with your family while you cheer for your favourite team can’t be beat.

Pamper yourself: Depending on the size of your return, spend it on you. Get a new haircut. Have a spa day. Buy a new outfit. With your updated look you will have the confidence to face another day at work or maybe even look for a new, better-paying job.

You get the idea. By all means pay off your student loan, save for the down payment on a house and get rid of credit card debt. But every now and then if you can afford it, spend your tax return on yourself and your family. After all, you’ve earned it.

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Written by Sheryl Smolkin

Sheryl Smolkin LLB., LLM is a retired pension lawyer and President of Sheryl Smolkin & Associates Ltd. For over a decade, she has enjoyed a successful encore career as a freelance writer specializing in retirement, employee benefits and workplace issues. Sheryl and her husband Joel are empty-nesters, residing in Toronto with their cockapoo Rufus.

One of the perennial questions that comes up in the first two months of every year is whether individuals should first contribute to a tax-free savings account (TFSA) or a registered retirement savings plan (RRSP), particularly if they cannot afford to max out contributions to both types of plans. And since 2009 when TFSAs first became available, every top personal finance writer has offered their opinion on the subject.

Chris Nicola on WealthBar created WealthBar’s ultimate TFSA vs RRSP calculator. He says saving for your retirement income using your RRSP will beat saving in a TFSA for most people as long as your marginal tax rate when you are saving is higher than your average tax rate when you withdraw the funds, since the RRSP lets you defer paying tax until retirement.

The Holy Potato TFSA vs RRSP Decision Guide allows you to work through the steps to see which savings plan is best for you. This infographic illustrates that RRSPs can only beat TFSAs if you are making RRSP contributions pre-tax (i.e. contributing your refund so more goes in the RRSP). If you fritter away your refund, go straight to the TFSA.

“Especially for lower income Canadians, the Marginal Effective Tax Rate (METR) in retirement may actually exceed the METR during an individual’s working years because of the effects of clawbacks on income-tested programs like the Old Age Supplement (OAS) and the Guaranteed Income Supplement (GIS). At various income levels, these benefits are reduced. If most of your retirement income is from fully taxable sources like CPP, RRSPs, company pensions, and OAS, your METR will be higher than if you mix in some tax-prepaid investments like TFSAs.”

The Wealthy Barber David Chilton sees the fact that you can take money out of a TFSA in one year and replace it in a future year as both a positive and a negative. Thus Chilton says:

“I’m worried that many Canadians who are using TFSAs as retirement-savings vehicles are going to have trouble avoiding the temptation to raid their plans. Many will rationalize, “I’ll just dip in now to help pay for our trip, but I’ll replace it next year.” Will they? It’s tough enough to save the new contributions each year. Also setting aside the replacement money? Colour me skeptical. After decades of studying financial plans, I am always distrustful of people’s fiscal discipline. And even if I’m proven wrong and the money is recontributed, what about the sacrificed growth while the money was out of the TFSA? Gone forever.”

Young and Thrifty’ Kyle Prevost’s TFSA vs RRSP: Head to Head Comparison (updated to 2018) has lots of colourful pictures. He believes the RRSP and the TFSA are like siblings. Not twins mind you – but siblings with different personalities. In some ways he says they are almost mirror opposites and the inverse of each other. Both options share the trait that let you shelter your investments from taxation – allowing your money to grow tax free using a wide variety of investment options. Each have their time and place, and are fantastic tools in their own way, but depending on your age and stage of life, one probably deserves more of your attention than the other.

His take when it comes to the TFSA vs RRSP debate is: “Yes… DO IT.” Prevost believes the real danger here is paralysis by analysis. Picking the “wrong” one (the better term might be “slightly less efficient one”) is still much better than not saving at all!

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Do you follow blogs with terrific ideas for saving money that haven’t been mentioned in our weekly “Best from the blogosphere?” Share the information on http://wp.me/P1YR2T-JR and your name will be entered in a quarterly draw for a gift card.

Written by Sheryl Smolkin

Sheryl Smolkin LLB., LLM is a retired pension lawyer and President of Sheryl Smolkin & Associates Ltd. For over a decade, she has enjoyed a successful encore career as a freelance writer specializing in retirement, employee benefits and workplace issues. Sheryl and her husband Joel are empty-nesters, residing in Toronto with their cockapoo Rufus.

For Canadian Xennials* (34-40), day-to-day life is getting in the way of saving for retirement. According to a recent survey from TD, three-quarters (74%) of this micro generation say they would like to contribute more than they currently do, but everyday financial obligations take precedence.

Seven in ten Canadian Xennials say they feel overwhelmed due to juggling other financial obligations with saving for retirement. These include common expenses such as monthly bills (cited by 60 %), paying off credit cards and personal loans (44%), mortgage payments (33%), childcare costs (24 %), home maintenance costs (22%), and repaying school loans (13%).

“We can all have the best of intentions when it comes to preparing for retirement, but then life gets in the way and we start to feel the retirement savings squeeze,” says Jennifer Diplock, associate vice president, personal savings and investing, TD Canada Trust. “Monthly bills fall due or we are faced with a loan repayment, and that can mean we end up contributing less than we should towards our retirement.”

When asked whether they agree they are too young to think about saving for retirement, there’s a notable shift between those 18 -34 (42%) and those 34 -40 (16%).

In fact, Statistics Canada identified that 72.2% of households with a major income earner aged 35 to 44 have a registered retirement savings plan (RRSP), registered pension plan or tax-free savings account (TFSA) but many are not contributing as much as they would like, with more than three-quarters of Xennials surveyed by TD (77 per cent) saying they plan to start contributing or to contribute more to retirement savings in the next five years.

As a result, half of Xennials describe themselves as feeling uncertain (52%) or unprepared (49%) for their retirement. The survey also indicates that the stresses felt by Xennials are reflective of the experience of other Canadians. For instance, while three in five Xennials point to the savings barrier of monthly bills, 62% of Canadians share this concern.

“The reality is that we all have to juggle our financial commitments to find the right balance when it comes to preparing for retirement,” said Diplock. “There are simple steps we can take to ease the retirement savings squeeze.”

For those looking to get on with their busy lives no matter which life stage they are at, while also setting aside enough funds for retirement, here are some suggestions.

Work towards the retirement you want
It may seem a long way off, but it isn’t too soon to start by thinking about what you want to do in retirement. You might want to travel the world, spend time volunteering or begin a new career. Because everyone wants a different retirement, there is no one financial template to follow. Once you’ve set out your vision, the next step is to establish a retirement savings goal. A useful and detailed online tool is the Canada Retirement Income Calculator which can show you how much you may need to put into savings in order to live the life you want in your retirement years.

Save your way
While juggling financial obligations, many people find making smaller weekly, bi-weekly or monthly Saskatchewan Pension Plan, RRSP or TFSA contributions easier than paying a large lump sum at once. Setting up a pre-authorized payment plan means finding the right schedule and plan for you. Peace of mind comes from knowing that you are steadily moving towards your retirement savings goal. For example, if you receive a pay raise at work or start a new job, you can increase the amount you are saving.

Examine your expenses
Whether it’s paying back your loans or scrutinizing your monthly bills to determine essential expenses, determine how much you should pay yourself too. These are small steps we can all take to maximize the amount we spend doing the things we like most, while still saving for retirement.

The earlier, the better
Whether or not you are a Xennial, there is no time like the present to start saving for your future. Keep in mind that the earlier you start, the more you can benefit from compound interest. With compound interest, the interest you earn is added to your principal investment, so that the balance doesn’t merely grow, it grows at an increasing rate. Whether your retirement feels like a lifetime away or is just around the corner, it’s important to factor in your retirement savings when planning your monthly budget. Receiving financial advice early on can help you put a sustainable saving structure in place to help keep your financial priorities and goals in check.

*Defined as the generation born between 1982 and 2004, millennials are aged between 13 and 35. The generation before, Gen X, spanned another 20 years, beginning in 1961 and ending in 1981. With such a large cohort, it’s hard to imagine everyone in these demographics identifies with the perceived persona of these generations. Enter Xennials, the new term being used to describe people born between 1977 and 1983.

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Do you follow blogs with terrific ideas for saving money that haven’t been mentioned in our weekly “Best from the blogosphere?” Share the information on http://wp.me/P1YR2T-JR and your name will be entered in a quarterly draw for a gift card.

Written by Sheryl Smolkin

Sheryl Smolkin LLB., LLM is a retired pension lawyer and President of Sheryl Smolkin & Associates Ltd. For over a decade, she has enjoyed a successful encore career as a freelance writer specializing in retirement, employee benefits and workplace issues. Sheryl and her husband Joel are empty-nesters, residing in Toronto with their cockapoo Rufus.

You have finally paid off the credit card bills incurred on your summer vacation. Black Friday is coming up and you are starting to get serious about Christmas shopping. But before you do, pay yourself first and top up your retirement savings.

Here are some suggestions:

Saskatchewan Pension Plan: If you are already a member of SPP, make sure you have contributed the maximum $2,500 for 2017. Also transfer up to $10,000/year into the plan from a Registered Retirement Savings Plan before the end of the year. If you are not a member, it’s never too late to sign up. Historically SPP has had 8% average returns, a 1% or less fund management fee and contributions are tax deductible. Your money will be professionally managed by independent investment firms and you can set up a flexible pension contribution schedule. When you join SPP, you name a beneficiary for your account, which can be changed at any time. If you die before retiring from the Plan, the funds in your account are paid to your named beneficiary. If your beneficiary is your spouse, financially dependent child or grandchild, CRA allows for tax-deferred transfer options.

RRSP: Avoid the end of February rush and top up your contributions now, before you are tempted to indulge in excessive holiday spending. Your RRSP contribution limit for 2017 is 18% of earned income you reported on your tax return in the previous year, up to a maximum of $26,010. You may also have unused contribution room carried forward from previous years. If you have a company pension plan or you contribute to SPP, your RRSP contribution limit will be reduced accordingly. Contributions are tax deductible and your RRSP investments are tax sheltered until withdrawn. At that time, 100% of the contributions plus interest are taxable at your incremental rate.

Tax free savings account: A TFSA is a flexible investment account that can help you meet both your short- and long-term goals. Contributions are made with after tax dollars. However, investment income in a TFSA — whether you’re earning interest, dividends or capital gains — is not taxed, even when withdrawn. The contribution room for 2017 is $5,500. Contributions can be carried forward, and contribution room since the program’s inception in 2009 has been $52,000. Money withdrawn from a TFSA can also be replaced in the subsequent calendar year.

Set up a spousal account: If your spouse is earning much less than you and therefore cannot make significant RRSP contributions, consider setting up a spousal RRSP. A spousal RRSP is simply a plan that you contribute to, but your spouse owns. Making contributions to a spousal RRSP provides you, the contributor, with a tax deduction provided you have sufficient RRSP contribution room, but your spouse will pay tax on the withdrawals from the plan. You may also set up a spousal SPP plan and contribute all or part of your annual maximum $2,500 contribution to your partner’s account. Normally, you can’t contribute to an RRSP in the year after you turn 71 even if you’re still working. But if you have a spouse who is 71 or under, you can contribute to a spousal RRSP and still get a tax break.

Find a “side hustle:” If you are having trouble making ends meet but you want to top up your retirement savings, the holiday season is the ideal time to look for a side hustle, or part-time job. For example, major retailers hire additional sales help. December is one of the busiest months for shipping companies. Catering companies need chefs, bartenders and servers. Market research companies need Canadians to join their consumer survey panels. You can rent your empty bedroom or apartment on Air BnB to extended families who visit parents living in small apartments, Friends or neighbours who travel are always looking for reliable dog or cat sitters

If you have not already done so, set up automatic withdrawal plans with SPP and your RRSP and TFSA providers. In this way, by late November 2018 you will be able to concentrate on the upcoming holiday season, secure in the knowledge that your retirement savings are on autopilot.

Written by Sheryl Smolkin

Sheryl Smolkin LLB., LLM is a retired pension lawyer and President of Sheryl Smolkin & Associates Ltd. For over a decade, she has enjoyed a successful encore career as a freelance writer specializing in retirement, employee benefits and workplace issues. Sheryl and her husband Joel are empty-nesters, residing in Toronto with their cockapoo Rufus.

Because you were not employed in 2016 or you earned less than the basic personal deduction ($15,843 in Saskatchewan) you may not be worried about meeting the May 1st income tax deadline. But there are many good reasons to file a tax return even if you don’t have any income to report. For example:

Get a refund: If you worked for some period of time and your employer deducted income taxes you actually didn’t have to pay it is the only way to get a refund.

TFSA contribution room: It is the easiest way to establish contribution room for a Tax-Free Savings Account although contribution room is not affected by taxable income.

Earned income for RRSP purposes. Even if you do not wish to contribute to an RRSP currently, “earned income” amounts can be carried forward indefinitely. For RRSP purposes, earned income includes net employment income, net rental income from real property, CPP/QPP disability benefits and taxable alimony received.

Refundable tax credits: There are some federal and provincial refundable tax credits that may be payable to you even if you have no earnings and paid no tax. For example, see the federal Working Income Tax Benefit.

GST/HST credit: Generally, Canadian residents age 19 or older are eligible to receive the federal GST/HST credit, which is paid quarterly to eligible recipients. Those under 19 may be eligible, if they have (or previously had) a spouse or common-law partner, or if they are a parent and they reside with their child.

Non-capital loss: You have incurred a non-capital loss (see line 236) in 2016 that you want to be able to apply in other years.

Education credits: You want to carry forward or transfer the unused part of your tuition, education, and textbook amounts. See line 323.

GIS: You receive the guaranteed income supplement or allowance benefits under the old age security program. You can usually renew your benefit by filing your return by April 30. However, if you choose not to file a return, you will have to complete a renewal form. This form is available from Service Canada,

Also consider having your children file a tax return reporting income from various types of part-time work (paper route, baby-sitting, lawn mowing, etc.), even if they do not have to pay income tax, so they can create their own RRSP contribution room.

Making maximum annual available contributions to Saskatchewan Pension Plan plus your Registered Retirement Savings Plan and Tax-Free Savings Account will help to ensure that you have the retirement savings you need to support yourself once you leave the world of work.

However, there probably have been years when you have not been able to make the full available contributions. But fortunately, both RRSP and TFSA contribution room can be carried forward, so if your financial circumstances improve in future or you get a windfall like an inheritance or win a lottery, you can catch up.

Here is some information about 2016 and 2017 contribution limits plus how you can find out whether you have contribution room that has been carried forward.

SPPYou can contribute up to $2,500 a year to SPP. In order to do so, you must have RRSP contribution room (see below). SPP contribution room cannot be carried forward if contributions are not maxed out each year. You can also transfer up to $10,000/year from your RRSP to SPP. Again, this transfer limit cannot be aggregated and carried forward to future years.

RRSPThe RRSP deduction and contribution limit is 18% of your earned income to a maximum value each year. The maximum RRSP contribution limit for 2016 is $25,370 and for 2017 it will be $26,010. Unused contributions are carried forward each year, so if you didn’t maximize your RRSPs in previous years, you can add the unused amount to this year’s limit. RRSP contribution room is not restored in future years if you withdraw funds.

You can find out how much RRSP contribution room you have by going to:

The “Available contribution room for 2016” amount found on the RRSP/PRPP Deduction Limit Statement, on your latest notice of assessment or notice of reassessment

Form T1028, Your RRSP/PRPP Information for 2016. CRA may send you a Form T1028 if there are any changes to your RRSP/PRPP deduction limit since your last assessment.

TFSASince the Tax Free Savings Account (TFSA) was introduced in 2009, Canadian residents over the age of 18 with a social insurance number have been permitted to contribute on annual basis. Here are the contribution limits by year:

2009-2012: $5,000

2013-2014: $5,500

2015: $10,000

2016: $5,500

2017: $5,500.

If you are setting up a TFSA for the first time in 2016 you can contribute up to $46,500 (or $52,000 if you want to also make 2017 contributions). Withdrawals are permitted and the amount you take out can be re-contributed in the following year in addition to the $5,500 allotted for the next year plus any other carry forward of TFSA contribution room you may have.

Keeping track of available TFSA contribution room is important because if you over contribute, anything over the allowed tax free contribution room is subject to a 1% penalty charged on a monthly basis on the highest excess tax free savings amount.

According to a recent TD survey, more than two-thirds of Canadians between the ages of 35 and 54 say they’re not saving enough for retirement, and one in four say not being ready for retirement is keeping them up at night. As a result, the majority of Gen-X Canadians (60%) who aren’t saving enough do not expect to be able to retire on time and half as many (29%) expect to still be working in some capacity during retirement.

The top barrier preventing Gen-Xers from retiring on time is everyday financial demands like living expenses, mortgage or rent, and childcare costs (61%), followed by existing debt (42%) and major unexpected life events such as divorce or death of a spouse (19%). Given these challenges, it’s not surprising that more than half (54%) of Gen-X Canadians surveyed say they need help meeting their financial goals, with a majority feeling guilty about not saving enough for retirement and wishing they had started earlier.

If you have fallen behind in saving for retirement, here are some ways you can get on track to achieving your savings goals and become retirement-ready.

Track your spendingMore than three in five (61%) Gen-Xers attribute everyday financial demands as the reason they don’t expect to retire on time. Keeping a record of your spending is a simple way to see where your money goes each month and look for ways to cut back on expenses to free up funds and help boost your savings.

Once you’ve identified some monthly savings, consider arranging for those funds to be transferred automatically into Saskatchewan Pension Plan, a Retirement Savings Plan (RSP) or Tax-Free Savings Account (TFSA). As you identify even more savings over time, you can increase the amount transferred automatically each month. Remember to also factor in any additional money you receive throughout the year such as annual raises or bonuses.

Tackle your debt while also savingFour in ten (42%) Gen-Xers attribute existing debt as a top reason that prevents them from retiring on time. While everyone’s financial picture is different, there are a few key steps you can take immediately to help pay down debt while building up savings:

As you start tracking your spending and becoming more in control of your finances, take a look at where your money is going and determine where you can free up cash flow to go towards paying down debt.

Seek out groups and communities – either online or in your neighbourhood – where you can sell stuff you no longer use or need, and use those funds to pay down your debt. One person’s junk is another person’s treasure.

Look for tips and tools online, like this Debt Repayment Calculator, to help you become organized by determining how much you owe and prioritizing what to tackle first. You can stay on top of your debt more easily when you have a repayment plan.

According to the survey, of Gen-Xers who are already saving for the future, the majority (64%) rely on RSPs to help fund their retirement. If you have RSP savings room, this video will show you how easy it is to join the Saskatchewan Pension Plan. SPP is an easy, flexible, cost-effective way that any Canadian over age 18 can save $2,500/year. You can also transfer an additional $10,000 a year into your SPP account from another RSP.

You have filed your income tax return and now all you are waiting for is to see your overpayment appear in your bank account. While paying too much taxes and getting it back at the end of the year really means you are giving the Canada Revenue Agency a no-interest loan, the fact is that particularly with interest rates so low, many of us look forward to a windfall every spring.

Because my husband retired in June 2015, we are getting a nice chunk of money back and we are planning to spend it on a cruise to Australia and New Zealand for our 40th anniversary this fall. But depending on your age and stage of life, there may be many better places to spend the money than taking an exotic vacation.

Here are some options for you to consider in no specific order:

Pay off high interest debt
If you have credit card or other high interest consumer debt and can only afford to make minimum payments, double digit interest rates mean the amount you owe is growing instead of shrinking. Consider consolidating your debts a lower rate of interest and paying them down with your income tax return.

Seed your emergency account
Everyone knows somebody who has lost their job or had to stop work earlier than planned due to family illness. Most financial experts suggest you have at least three months’ salary in your emergency fund. This calculator from RBC can help you figure out how much you need. Your income tax return can help you seed or top up an emergency fund.

Pay down your student loanCanada Student Loans are interest-free for six months after you graduate or leave school. You can choose between a fixed interest rate (where the rate doesn’t change for the duration of your loan) and a variable, or “floating,” interest rate (where it can fluctuate). For Canada Student Loans issued on or after August 1, 1995:

The fixed interest rate is prime + 5%

The floating interest rate is prime + 2.5%

The sooner you pay off your student loan, the sooner you can free up disposable income to save for other family priorities like a house or a car.

Pay down your mortgage
The longest running personal finance debate is whether you should use an income tax return or other windfall to pay down your mortgage or contribute to an RRSP or TFSA. Typically if you are paying a higher interest rate than you are earning in a savings vehicle, paying down your mortgage is more advantageous. Also, if at all possible, try to pay off your mortgage before you retire.

Contribute to a TFSA
In 2016 you can contribute $5,500 to a tax-free savings account. Contribution room from previous years can be carried forward. There is no tax deduction for contributions but your principle and any interest accumulates tax free and there is no tax on withdrawals. Also, if you take money out your TFSA contribution room is restored. Using your tax return to contribute to a TFSA allows you to accumulate money for retirement or other major purchases in the years prior to retirement. It is also a good place to park your emergency fund.

Contribute to an RRSP
Are you one of those people who scrambles to come up with a registered retirement savings plan contribution in February every year? By contributing your tax return to your RRSP you will get a head start on this year’s contribution and reach your retirement goals much sooner.

Contribute to an RESPTuition fees alone for Canadian undergraduate programs are currently about $6,000/year and they will be much higher before your young children graduate from high school. College tuition is lower but by the time you add books, living expenses and transportation costs these programs also cost thousands of dollars a year. If you use your income tax return to contribute to a Registered Educational Savings Plan, the money will accumulate tax free and taxes will be paid by the student who will likely have to pay little or no taxes. Also, an annual contribution of up to $2,500 will attract a government grant of up to $500/year to a lifetime maximum of $7,200.

Give to charity
If you donate all or part of your tax refund to an approved charity, you will not only benefit others, but you will get a non-refundable tax credit. If it is the first time you have made a charitable donation you may be eligible for the first-time donor’s super credit which supplements the value of the charitable donations tax credit by 25%. The FDSC applies to a gift of money made after March 20, 2013, up to a maximum of $1,000, in respect of only one taxation year from 2013 to 2017.

Upgrade your education
You want to upgrade your skills to put you in line for a promotion. You are bored with your current job and want to train part-time for another one. You’ve always wanted to fix your own car or learn a new language. You can use your income tax return to upgrade your education and you may also be entitled to tax credits for the tuition paid.

Invest in your health
Your dental plan does not cover the braces your child needs. You need a new pair of glasses that cost way more than the $150 every two years paid by your medical plan. You want buy training sessions at your gym to reach your fitness goals faster. Your income tax return can be used to invest in you or your family’s health and wellness.